Indonesia lowers rate for first time in 11 months
The bank reportedly stated in a statement that further policy easing will be considered after a thorough assessment of the domestic and global economic situation.
The bank had been reluctant to cut rates ahead of the US Federal Reserve’s rate increases in December out of concerns for the stability of the rupiah, which was the second worst performing currency among emerging Asian economies last year.
Meanwhile, ongoing weakness in the Chinese economy and the recent turbulence in the Chinese stock market put additional downward pressure on Indonesia’s economy, which is expected to grow between 4.7% and 5.1% in 2015, posting the slowest growth since 2009.
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